Trust Board papers November 2012 - Barking Havering and ...

EXECUTIVE SUMMARY
TITLE:
Finance Report – Month Six (September)
2012/13
BOARD/GROUP/COMMITTEE:
Trust Board
1. KEY ISSUES: REVIEWED BY (BOARD/COMMITTEE) and
DATE:
• In the six month period to the end of September the
trust recorded a year to date deficit of £26.0m
(adjusted for impairments & IFRS reversals), which is
£2.0m worse than plan for the period. This adverse
variance is primarily explained by a £2.2m shortfall
against the CIP target to date.
• The in-month deficit of (£3.5m) was in line with plan.
This represents an improvement on the average monthly
run rate deficit to Month 5 of £4.5m and the deficit in
Month 5 of £5.5m.
• The income position to date is £2.1m ahead of plan.
Some payment for over-performance with ONEL has
now been agreed and £2.7m of this additional income is
reflected in the year to date income position. Underperformance
on non-ONEL SLAs (primarily Essex) has
reduced income during the period by £0.4m.
• The projected income position at the year-end is for
an over-performance of £19.6m on the ONEL contract,
less £0.9m under-performance for non-ONEL. This
represents a significant risk as the commissioners have
not yet agreed to fund £5.0m of these treatments.
• Aside from the CIP shortfall, the expenditure position
shows a £1.7m overspending year to date. This
overspending is largely associated with the activity overperformance.
An appropriate proportion of the income
over-performance is being devolved to business units, to
mitigate the marginal cost of over-performance.
• The CIP position shows year to date delivery of £4.3m
against a target for the period of £6.5m, a shortfall of
£2.2m. The forecast delivery is £17.7m of which
£4.8m is considered to be at high risk, which is an
improvement on the £6.2m of high risk schemes
reported last month. The Trust aims to have plans in
place by the end of the month to deliver all of the £17.7m
forecast.
• This compares to a CIP target of £23.1m for the year.
The PMO/E&Y are leading further work to mitigate the
risks, maximise the savings opportunities and is aiming
to deliver at least £20m CIPs.
□ S&SIB ………………□ EPB…...…………..
□ FINANCE ……………□ AUDIT ….……..….
□ CLINICAL GOVERNANCE …………..…......
□ CHARITABLE FUNDS ……………………….
TRUST BOARD ………………………………
□ REMUNERATION ……………………………
□ OTHER ………………………(please specify)
CATEGORY:
□ NATIONAL TARGET □ CNST
□ STANDARDS FOR BETTER HEALTH
□ ASSURANCE FRAMEWORK
□ TARGET FROM COMMISSIONERS
CORPORATE OBJECTIVE To achieve financial
security for the Trust, with reduced costs, improved
productivity and collecting income due
□ OTHER …………………….. (please specify)
AUTHOR/PRESENTER:
Alan Davies, Deputy Director of Finance / David
Gilburt, Director of Finance
DATE:
• The Trust has significant risks to both income and
CIP delivery. With this level of risk our ability to
deliver the £39.7m year-end control total must be in
doubt.
• We need Commissioners to fund the projected activity
and the Trust has to deliver the CIP savings.
• Discussions continue with the commissions and a
detailed review of the forecast outturn will be
completed and reported to the November Finance
Committee
2. FINANCIAL IMPLICATIONS/IMPACT ON CURRENT FORECAST:
Set out under key issues
3. ALTERNATIVES CONSIDERED/REASONS FOR REJECTION:
1